Report Title:

Retiree benefit plans

Description:

Provides an appropriate, cost-neutral adjustment of the base monthly contributions for retiree benefit plans, in the event the EUTF Board of Trustees adopts a revised rate structure for its retiree benefit plans.

HOUSE OF REPRESENTATIVES	H.B. NO.	1294
TWENTY-FOURTH LEGISLATURE, 2007
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO THE HAWAII EMPLOYER-UNION HEALTH BENEFITS TRUST  FUND.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  Section 87A-33, Hawaii Revised Statutes, is amended to read as follows:

     "§87A-33  State and county contributions; retired employees.  (a)  Notwithstanding any law to the contrary, this section shall apply to state and county contributions to the fund for:

     (1)  The dependent-beneficiary of an employee who is killed in the performance of duty;

     (2)  A dependent-beneficiary, upon the death of the employee-beneficiary, except as provided in section 87A-36;

     (3)  An employee-beneficiary who retired after June 30, 1984, due to a disability falling within sections 88-79 and 88-285;

     (4)  An employee-beneficiary who retired before July 1, 1984;

     (5)  An employee-beneficiary who:

         (A)  Was hired before July 1, 1996;

         (B)  Retired after June 30, 1984; and

         (C)  Who has ten years or more of credited service, excluding sick leave;

     (6)  An employee-beneficiary who:

         (A)  Was hired after June 30, 1996; and

         (B)  Retired with twenty-five or more years of credited service, excluding sick leave, except as provided in section 87A-36; and

     (7)  Employees who retired prior to 1961 and their dependent-beneficiaries.

     (b)  Effective July 1, 2003, there is established a base monthly contribution for health benefit plans that the State, through the department of budget and finance, and the counties, through their respective departments of finance, shall pay to the fund, up to the following:

     (1)  $218 for each employee-beneficiary enrolled in supplemental medicare self plans;

     (2)  $671 for each employee-beneficiary enrolled in supplemental medicare family plans;

     (3)  $342 for each employee-beneficiary enrolled in non-medicare self plans; and

     (4)  $928 for each employee-beneficiary enrolled in non-medicare family plans.

     The monthly contribution by the State or county shall not exceed the actual cost of the health benefits plan or plans.  If both husband and wife are employee-beneficiaries, the total contribution by the State or county shall not exceed the monthly contribution for a supplemental medicare family or non-medicare family plan, as appropriate.

     (c)  Effective July 1, 2004, there is established a base monthly contribution for health benefit plans that the State, through the department of budget and finance, and the counties, through their respective departments of finance, shall pay to the fund, up to the following:

     (1)  $254 for each employee-beneficiary enrolled in supplemental medicare self plans;

     (2)  $787 for each employee-beneficiary enrolled in supplemental medicare family plans;

     (3)  $412 for each employee-beneficiary enrolled in non-medicare self plans; and

     (4)  $1,089 for each employee-beneficiary enrolled in non-medicare family plans.

     The monthly contribution by the State or county shall not exceed the actual cost of the health benefit plan or plans and shall not be required to cover increased benefits above those initially contracted for by the fund for plan year 2004-2005.  If both husband and wife are employee-beneficiaries, the total contribution by the State or county shall not exceed the monthly contribution for a supplemental medicare family or non-medicare family plan, as appropriate.

     (d)  The base composite monthly contribution shall be adjusted annually, beginning July 1, 2005.  The adjusted base composite monthly contribution for each new plan year (July 1 until June 30) shall be calculated by increasing or decreasing the base composite monthly contribution in effect through the end of the previous plan year by the percentage increase or decrease in the medicare part B premium rate for those years, which percentage shall be calculated by dividing the medicare part B premium rate in effect at the beginning of the new plan year by the rate in effect at the beginning of the previous plan year.

     For the plan year beginning July 1, 2005, the adjusted base monthly contribution shall be computed using the actual contracted premium rate as of July 1, 2004, for medicare and non-medicare, self and family health benefits plans with the highest actual contracted premium rate as of July 1, 2004.

     As used in this subsection, "medicare part B premium rate" means the rate published in the Federal Register each year on November 1 or on the business day closest to November 1 of each year after the medicare part B premium rate has been established by the Secretary of Health and Human Services and approved by the United States Congress.

(e)  If the board adopts a rate structure that provides for other than self and family rates for the health benefit plans, the base monthly contribution for the rate structure adopted by the board shall be adjusted to provide the equivalent underwriting cost as the base monthly contribution that is provided for in this section."

     SECTION 2.  New statutory material is underscored.

     SECTION 3.  This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________
	BY REQUEST